Ellie Mae to Go Private

Ellie Mae[1], the Pleasanton, California-headquartered fintech provider for the mortgage finance industry is being acquired by private equity investment firm, Thoma Bravo, LLC[2] in an all-cash deal valued at around $3.7 billion.

Under the terms of the agreement, all Ellie Mae shareholders will receive $99.00 in cash per share. The price per share represents a 47 percent premium to the 30-day average closing share price and a 49 percent premium to the 60-day average closing price as of February 1, 2019. While Ellie Mae will remain at its Pleasanton headquarters it will be run as a privately-held company.

“As we enter this next phase of our digital mortgage journey, we are thrilled to provide immediate value to our shareholders. With the investment and support from Thoma Bravo, we will remain committed to our customers’ success, innovation and growth of the Encompass Digital Lending Platform while maintaining our position as the best place to work,” said Jonathon Corr, President and CEO of Ellie Mae.

The transaction is expected to close in the second or third quarter of 2019 and is not subject to a financial condition. Ellie Mae said that its Board of Directors unanimously approved the definitive agreement and recommended that stockholders vote their shares in favor of the transaction.

“Ellie Mae delivers powerful and innovative mortgage technology solutions across every channel of the residential mortgage sector, enabling lenders to originate more loans while reducing costs and driving efficiency, quality, and compliance throughout the mortgage process,” said Holden Spaht, a Managing Partner at Thoma Bravo. “Ellie Mae is leading the digital transformation of the residential mortgage industry and we look forward to building on the company’s successes and to our partnership through this next chapter of growth.”

The agreement includes a 35-day “go-shop” period, which permits Ellie Mae’s Board and advisors to actively initiate, solicit, encourage, and potentially enter negotiations with parties that make alternative acquisition proposals.